Apologies all: my initial post missed the point. What El-Erian said on May 4 was, "In the next few months, possibly within weeks, markets here and abroad will be looking for signals that our politicians understand the severity of the situation and are able and willing to act appropriately. If clear signals are not forthcoming, markets could react early to the looming trouble, [a shift of 4% on the national income to taxes in order ot reduce the deficit] compounding the uncertainties that weigh on the U.S. economy."

El-Erian (a chief executive of Pimco) goes on to say: "the importance of this issue cannot be overstated. A fiscal contraction of this magnitude and composition would stop in its tracks the economy's nascent healing and job creation.